Fewer taxpayers are likely to get a refund this year, Goldman Sachs says

Sorry, taxpayers. Fewer of you are likely to get a refund this year than you did last year, Goldman Sachs believes.

Goldman’s Alec Phillips picks out some telling numbers in a recent note that explains why. He notes 84% of tax returns processed so far have qualified for a refund. But this is a “slightly smaller share than have received a refund in the last few years,” he writes. And if the trend continues? The likely result is 4 to 5 million fewer taxpayers will get a refund than last year.

If you’re among those getting a refund, however, you can look on the bright side. Phillips cites the latest IRS data indicating that the average refund payment is 2.6% greater than it was last year. A caveat, however: he writes that by the time tax filing season has concluded, cumulative refunds may rise slightly less than this.

All this has implications for the federal budget balance, as Phillips notes. Goldman forecasts a fiscal year 2014 deficit of $525 billion, somewhat higher than the Congressional Budget Office’s forecast of $514 billion. The Goldman report assumes growth in individual tax receipts of about 5%. Phillips says the tax filing season to date implies that receipts are likely to hit that estimate “and might even exceed it slightly.”